What does “Living within your means”, mean?
It means you cannot afford your lifestyle without borrowing from someone or somewhere.
If you are relying on credit (lines of credit, mortgage consolidation, credit cards, friends/family) to get by each month, you are living above your means.
If you are relying on friends and family (donations, yearly gifts from generous parents and so on), you are living above your means
If you cannot pay your own way for even ONE day a month with the actual cash you have in your bank account each and every month, you are living above your means.
3 Steps to Stop:
Cut yourself off from all lines and accesses to credit.
Look at your net take-home pay per month (whatever is deposited into your bank account by your employer, after taxes & any retirement savings)
Make your net take-home pay match your expenses and savings to balance to $0.
E.g. if you bring home $2000 net a month, you should only spend and save $2000 a month. Not a penny more or less.
(P.S. Did anyone catch how many times I had to write “means” or “mean” in the post above? Winner gets… the satisfaction of being able to answer this question.)